sign in sign up
<<
Home , Jiangsu, Taixing

Supreme People’s Court of the People’s Republic of

Civil Ruling

(2015) Min Shen Zi No.1366

Retrial applicant (Defendant in first instance, appellant in second instance): Jinhui Chemical Company. Domicile: No. 10 Xingang Road, Economic Development Zone, Taixing, Legal Representative: Jiangbo, Chairman of the Board of the company Attorney: ZHAO Bing, lawyer, Jurisino Law Group

Respondent (Plaintiff in first instance, appellee in second instance): Taizhou Environmental Protection Federation. Domicile: No. 18 Yonghui Road, Taizhou, Jiangsu Province. Legal Representative: TONG Ning, Secretary General of the Federation Attorney: CHEN Xiaojun, lawyer, Jiangsu Jianghao Law Attorney: ZHANG Wencan, lawyer, Jiangsu Tianzi Law Firm

Defendant in first instance, appellant in second instance: Jiangsu Changlong Agrochemical Co., Ltd. Domicile: No. 8 Tuanjiehe Road, Economic Development Zone, Taixing, Jiangsu Province. Legal representative: Weihua, General Manager of the company

Defendant in first instance, appellant in second instance: Jiangsu Shimeikang Pharmaceutical Company. Domicile: No. 10-2, Xingang Nanlu, Economic Development Zone, Taixing, Jiangsu Province Legal representative: WANG Junhua, Chairman of the Board of the company Attorney: Zhang Yabin, lawyer, Jaingsu Hengqiao Law Firm

Defendant in first instance, appellant in second instance: Taixing Shenlong Chemical Co., Ltd. Domicile: No. 3, Shugang Road, Economic Development Zone, Taixing, Jiangsu Province Legal representative: JIANG Desheng, Vice General Manager of the company

Defendant in first instance: Taixing Fu’an Chemical Co., Ltd. Domicile: No. 8, Zhonggang Road, Economic Development Zone, Taixing, Jiangsu Province Legal representative: Taohan, Chairman of the Board of the company Attorney: YU Xinsheng, lawyer, Jiangsu Youfang Law Firm

Defendant in first instance: Taixing Zhenqing Chemical Co., Ltd. Domicile: No. 10, Shugang Road, Economic Development Zone, Taixing, Jiangsu Province Legal representative: YANG Jiqun, manager of the company

Retrial applicant Taixing Jinhui Chemical Company (hereinafter referred to as “Jinhui”) has applied to this Court for a retrial against the respondent, Taizhou Environmental Protection Federation (TEPF) due to dissatisfaction with the Su Huan Gong Min Zhong Zi No.00001 (2014) by Jiangsu High People’s Court concerning the pollution tort dispute between TEPF and Jinhui together with defendants in first instance and appellants in second instance Jiangsu Changlong Agrochemical Co., Ltd. (hereinafter referred to as “Changlong”), Jiangsu Shimeikang Pharmaceutical Company (hereinafter referred to as “Shimeikang") and Taixing Shenlong Chemical Co., Ltd., defendants in first instance Taixing Fu’an Chemical Co., Ltd. and Taixing Zhenqing Chemical Co., Ltd. In accordance with relevant laws, this court established a colligate panel to review the case. The review has now been completed.

In the retrial application, Jinhui claimed that: 1. The court of the second instance erred in the determination of the amount of acid by-products dumped by Jinhui through Taizhou Jiangzhong Co., Ltd. (hereinafter referred to as “Jiangzhong“). 1) According to the statement by DAI Weiguo etc., 653.08 tons of acid by-products produced by Jinhui was dumped by Jiangzhong. 2) According to the transportation invoice issued by the Taixing branch of Xinghua Xieyu Transportation Co., Ltd. (hereinafter referred to as “Xieyu Taixing”), Jinhui provided 1702.27 tons of acid by-products to be transported. Given the court of the second instance deemed the transportation cost as equal to the cost of compensating for dumping, the amount of acid by-products involved should be determined based on the amount shown on the transportation invoice. 3) According to the records of sales invoice, DAI Weiguo etc. started dumping acid by-products sold from Jinhui to Jiangzhong since August 2012. Prior to that, Jinhui had invoiced to Jiangzhong 3822.2 tons of acid by-products. The 455.42 tons of acid by-products invoiced on December 29th 2011 was recorded in 2012, rather than dumped in 2012. These two figures (i.e. 3822.2 tons and 455.42 tons) should not be counted in the total amount of acid by-products sold by Jinhui to Jiangzhong, and therefore the correct amount should be either 653.08 tons or 1702.27 tons.

2. There is no factual grounding for the judgement in the second instance to rule that Jinhui should pay for environmental restoration costs. 1) The rivers involved in the case do not need to be restored and compensated. Before the pollution took place, the water quality of Rutai Canal and Gumagan River was classified as Class III. By 2013, the rivers had purified themselves and the water quality remained Class III. TEPF did not submit any evidence arguing that the pollution had caused any losses to any persons or properties, so Jinhui should not be liable for environmental restoration costs or compensating for any losses. 2) The judgement of the second instance did not confirm or assess the actual ecological damage to the rivers involved in the case. There is no factual or legal grounding for calculating ecological damage of these rivers based on water pollution remediation costs. 3) The method used in determining and calculating restoration costs was wrong. Recommended Methods of Assessing Environmental Pollution Damages (1st Edition) (hereinafter referred to as "Recommended Methods”) issued by Chinese Academy for Environmental Planning of Ministry of Environmental Protection recommended three methods for assessing environmental damage costs -- the “actual remediation expenses” method, the “virtual management costs” method and the “virtual remediation costs” method. The Technical Report of Environmental Damage Assessment for Waste Acid Dumping Incident in Taixing Gumagan River & Rutai Canal on December 19 (hereinafter referred to as Technical Assessment Report) determined the unit cost for water quality restoration with reference to the “virtual remediation costs” method prescribed by Article 4.5.2 of Recommended Methods 1st Edition. The report used chemical oxidation method for water quality restoration, whose unit cost, according to the Recommended Methods, stands at CNY 700 per ton. Furthermore, according to the Recommended Methods, the environmental sensitivity coefficient for the water category is 1.4-1.6. As a result, the total environmental restoration cost should be over CNY 50 million, among which CNY 8,757,855 should be the liability of Jinhui. In addition, in the first instance, TEPF argued that the six defendants shall compensate for the water pollution damage, not restoration costs. Therefore, the judgement of the second instance exceeded the plaintiff’s claim by ruling the six defendants to pay for restoration costs.

3. The judgement of the second instance erred in the application of relevant laws. 1) The first edition of Recommended Methods had expired by the time of the second instance. According to the second edition, which should have been applied to reassess damages, there are two approaches to restore natural environmental damage – environmental remediation and ecological restoration, both based on the happening of actual ecological and environmental damage. However, there are no such ecological or environmental damage involved in the present case, so remediation/restoration is unnecessary. 2) Jinhui paid due care to the sales of acid by-products. Jinhui established contracts with the buyer and agreed on the payment of transportation costs. This is in accordance with Contract Law of the People’s Republic of China but not with Tort Law.

4. TEPF does not have the standing to bring the present environmental public-interest litigation (EPIL), so the judgement of the second instance erred in deeming it as an eligible party.

5. Jinhui should not be the liable party in the present case, because Jinhui did not discharge, dump or release any pollutants, neither did it incite another party to do so. Jinhui had nothing to do with how Jiangzhong disposed of the acid by-products it had purchased. There is no connection of intention between Jinhui and Jiangzhong. Therefore, Jinhui should not be liable for polluting the environment.

6. The judgement of the second instance erred in the application of law because the judgement referred to affirmation rules as prescribed in Article 170, Paragraph 1, Subparagraph 1 of the Civil Procedure Law of the People’s Republic of China (hereinafter referred to as “CPL”), but in fact amended the judgement of the first instance.

7. The judgement of the second instance infringed upon the autonomy of Jinhui by ruling that the environmental protection authorities shall have the decision power over the execution of section four of the main text of the judgement, which should have been the autonomy of Jinhui.

8. TEPF did not file litigations against other chemical companies involved in polluting the environment. Meanwhile, the court entertained EPILs brought by Friends of Nature, Chaoyang , against other local companies, which may affect the amount of compensation that Jinhui shall be liable for. As a result, in accordance with Article 200 Subparagraph 2, subparagraph 6 and subparagraph 11 of CPL, Jinhui submitted the retrial application.

TEPF responded as follows: 1. As one of “relevant organizations” prescribed in Article 55 of CPL, TEPF is a qualified party and has the standing to file civil EPILs.

2. The “sales” of acid by-products by Jinhui was illegal disposal of waste materials, and the causality between its behavior and environmental pollution can be established. 1) Employees of Jinhui admitted that the so-called “sale” of its acid by-products was equal to abandoning them and did not fit any features of any contract of exchange of goods. 2) Jinhui had or should have had the knowledge that Jiangzhong was not qualified or capable of disposing of acid by-products, as was confirmed by both DAI Weiguo and YAO Xueyuan according to documentary evidence recorded on April 24th 2013. 3) There was causality between the transfer of acid by-products from Jinhui to Jiangzhong and environmental pollution. Although Jinhui did not discharge, dump or release any pollutants by itself, it knew or should have known that Jiangzhong et al. were not qualified or capable of disposing of acid by-products. In addition, Jinhui was aware that the payment it made to Jiangzhong was not enough to dispose of acid by-products without causing any damages. By transferring the acid wastes which was of no use to itself, Jinhui provided both sources of pollution and illegal benefits for Jiangzhong.

3. The court of the second instance did not mistake the amount of Jinhui’s acid by-products dumped by Jinagzhong. 1) The figures claimed by Jinhui in the retrial application were all based on DAI Weiguo’s accounting records, but the time and facts contained in the records were not complete. 2) Jinhui garbled the statements by defendants of the criminal case. (1) DAI Weiguo and YAO Xueyuan confimed on August 8th 2013 that they had dumped 19361.16 tons of acid by-products for Changlong and Jinhui. (2) The actual dumping took place in late 2011, not in August 2012 as was argued by Jinhui by extracting statements of the criminal defendants. 3) , Vice General Manager of Jinhui, clarified on October 10th 2013 that DAI Weiguo and YAO Xueyuan balanced the books by providing transportation receipts or gasoline coupons for Jinhui. Therefore, the amount of acid by-products shall not be determined solely by transportation invoice.

4. There was a reasonable and legal grounding for the judgement of the second instance to use “virtual remediation cost” method. 1) The polluted rivers involved in the case must be restored because large amounts of acid by-products being dumped into the rivers posed severe damages to the water quality, aquatic organisms, the riverbed and the rest of the aquatic system. The water quality inspection report released by the local government showed that the government only conducted regular water quality inspections and did not cover the overall water quality. The water quality where the acid by-products were dumped cannot represent the damages to the river as a whole. 2) The “virtual remediation costs” method adopted in the judgement of the second instance was the correct method to be used. The “experimental value” method adopted in Technical Assessment Report concerned only the costs of reducing the harm of the pollution source, i.e. balancing the acid pollution using water from the River. However, the cost of restoring the environment was not included. Precisely because of the difficulty of calculating the actual restoration expenses, the “virtual remediation costs” method was adopted in accordance with Recommended Methods. 3) The second edition of Recommended Methods was issued until after the conclusion of the first instance, so at the time when the damages occurred, only the first edition was available. In the second instance, Jinhui never claimed invalidity of Technical Assessment Report or applied for a reassessment on the ground that Technical Assessment Report had expired. In addition, the second edition of the Recommended Methods continued to promote the “virtual remediation/restoration costs” method as the most commonly used approach to environmental evaluation.

5. The judgement of the second instance did not err in the application of Article 170, Paragraph 1, Subparagraph 1 of CPL as the procedure law for the judgement. 1) The judgement of the second instance was based on the consideration that the judgement of the first instance “was essentially correct and applied the law correctly”. This was consistent with Article 170, Paragraph 1, Subparagraph 1 of CPL which stated “…the facts were clearly ascertained, and the law was correctly applied”. 2) The judgement of the second instance affirmed the parties responsible for environmental restoration, items to be compensated and the amount of restoration costs as were ruled in the judgement of the first instance. It only posed additional conditions regarding the payment and the deduction of restoration costs. These were not change to the essential judgement and the application of law of the first instance. Instead, they were innovative methods adopted by the court of the second instance with the purpose of preventing and controlling environmental pollution from the root, combining the precautionary principle and judicial punishment. 3) Jinhui contradicted itself by claiming that the deduction conditions as ruled in the judgement of the second instance lack legal grounding on one hand, while accepting that 40% of restoration costs can be replaced by technology upgrading costs. In fact, Jinhui has already applied for deductions during the enforcement of the judgement.

6. Jinhui did not establish the correct understanding of the deductions. Jinhui regarded the deductions as a violation of its autonomy, but the procedures set out in the judgement of the second instance were designed to encourage companies to upgrade their technology, convert wastes into assets and recycle in order to reduce or avoid damages of acid by-products to the environment.

7. The inclusion or omission of any other polluting entities in the present case shall not affect the justice of the judgement. Environmental restoration costs in the present case were not determined based on the overall damage of the pollution but were determined based on the category and amount of pollutants dumped by each individual polluting entity. The findings of the judgement did not remove or reduce responsibilities of other potential polluting entities, nor did it increase liabilities of the six defendants. TEPF therefore maintained that the retrial application made by Jinhui should be rejected for lack of factual and legal grounding.

In the meeting before the trial convened by this Court, Jinhui confirmed that it had applied for a retrial based on Article 200, Subparagraph 1, Subparagraph 2, Subparagraph 6 and Subparagraph 11 of CPL. It submitted the following new evidence to this court: 1) Criminal judgement Tai Zhong Huan Xing Zhong Zi No. 00001 from the Intermediate People’s Court of Taizhou, Jiangsu Province (2014), which was intended to prove the wrong calculation of the amount of the acid by-products. 2) Civil Ruling Tai Zhong Huan Gong Min Su Zi No.00001 by the Intermediate People’s Court of Taizhou, Jiangsu Province (2015) with the intention to prove the involvement of Jiangsu Zhongdan Chemical Engineering Technology Co., Ltd. in the pollution incident. 3) Civil Ruling Su Huan Gong Min Su Zhong Zi No. 00001 by Jingsu High People’s Court (2015), which was intended to prove that the environmental restoration costs to be assumed by Jinhui was wrong.

In response to the above evidence, TEPF made the following reply: 1) Criminal judgement Tai Zhong Huan Xing Zhong Zi No. 00001 from the Intermediate People’s Court of Taizhou, Jiangsu Province (2014) provided by Jinhui was consistent with the second instance judgement of the present case and cannot prove the wrong calculation of the amount of acid by-products. 2) Civil Ruling Tai Zhong Huan Gong Min Su Chu Zi No. by the Intermediate People’s Court of Taizhou, Jiangsu Province (2015) and Civil Ruling Su Huan Gong Min Su Zhong Zi No. 00001 by Jiangsu High People’s Court (2015) are rulings on procedural issues of the present case but not rulings on the essence of the case. Even if there were other entities polluting the segment of water involved in the case at the same time – which was difficult to find out – the amount ruled in the present case shall not be affected. As a result, the new evidence provided by Jinhui cannot be used in the retrial investigation.

This court finds that the present case is a case for civil retrial review. According to Article 200 of CPL and Article 395 of the Interpretation of the Supreme People’s Court on the Application of the Civil Procedural Law of the People’s Republic of China, this Court shall examine if the cause for retrial alleged by the retrial applicant shall be supported. Therefore, the examining of the issues No.1, No.2, No.5 and No.7 raised by Jinhui were about whether Jinhui’s allegations in these issues were in accordance with Article 200 Paragraph 6 of CPL; No.3, No.4 and No.5 shall be examined in accordance with Article 200 Section 2 of CPL. In addition, in response to the new evidence provided by Jinhui and the issue that the judgement of the second instance exceeded the claim of the plaintiff, this court shall make judgements in accordance with Article 200 Paragraph 1 and Paragraph 11 of CPL.

1. On the eligibility of TEPF as the plaintiff in the present case

Article 55 of CPL stated, “For conducts that pollute the environment, infringe upon the lawful rights and interests of vast consumers or otherwise damage the public interest, an authority or relevant organization as prescribed by law may institute an action in a people’s court”. TEPF is a social organization registered at Taizhou Municipal Civil Affairs Bureau on February 25th 2014. With the role of a bridge between the government and the society, it aims to protect the environment of Taizhou and protect the entire humankind by bringing the idea of sustainability into practice, following a scientific approach to development, achieving the environmental protection goals set by the government of Taizhou and protecting environmental public interest. TEPF is licensed to advice on environmental decision-making and technical policy-making, protect environmental public interests and carrying out environment-related education activities. TEPF is fully eligible by law to file the present EPIL case on August 4th 2014 in accordance with Article 55 of CPL. Environmental Protection Law of People’s Republic of China (hereinafter referred to as “EPL”) enacted on January 1st 2015 is not applicable in the present case. This court finds against Jinhui’s groundless claim that TEPF is not an eligible party as the plaintiff of the present case.

2. On the causality between the sales of acid by-products by Jinhui and the pollution in Gumagan River and Rutai Canal

Jinhui and Jiangzhong agreed in the Contract of Purchase and Sales of Industrial and Mining Products signed by the two parties that Jinhui shall sell monthly 800 tons of acid by-products at market rate to Jiangzhong. According to the interrogation records of YAO Xueyuan and DAI Wiguo of Jiangzhong and inquiry records of Vice General Manager YANG and DAI Jiandong (responsible for safe production) of Jinhui, in the context of a sluggish acid by-product market, Jinhui sold the acid by-products at CNY 1 per ton but pays CNY 20 per ton of transportation subsidies to Jiangzhong to dispose of the acid as soon as possible. The payments were settled based on the actual amount of acid by-products transported by Jiangzhong. The nature of a Sales Contract is that the seller delivers goods and the buyer pays for the goods. In this case, Jinhui as the seller sold acid by-products at as low as CNY 1 per ton but in reverse paid CNY 20 per ton to Jiangzhong for transportation and/or compensated Jiangzhong in various forms, indicating that the Contract did not meet the features of a regular sales contract.

Acid by-products are hazardous chemicals which must be produced, sold, transported, stored and disposed of in compliance with set rules. According to Article 29, Paragraph 1 of Water Pollution Prevention and Control Law of People’s Republic of China, it is prohibited to discharge oil, acid, alkaline or highly toxic waste liquids into waters. Acid by-products are produced alongside useable chemicals and cannot enter the market. They should be disposed of by qualified entities in accordance with laws and regulations. Producers of dangerous chemicals and chemical products should have comprehensive knowledge of the risks and polluting potential of its products and by-products. They should make sure that the production, sales, transportation, storage and disposal of the products and by-products are compliant with the law to avoid damages or risks of damages to the ecology and the environment. The acid by-products produced by Jinhui falls into the category of hazardous chemical, so Jinhui should have paid close attention to the disposal of them. According to the interrogation records of DAI Weiguo and YAO Xueyuan, who dumped the acid by-products, and the inquiry records of YANG Jun and DAI Jiandong, Jinhui was fully aware of the dumping but did not stop it. Although Jinhui was not engaged directly in the dumping, it provided Jiangzhong, a company without qualification to handle hazardous chemicals, with acid by-products which can only be disposed of at high expenses due to the sluggish market. In addition, Jinhui did not intervene in the vast pollution in Rutai Canal and Gumagan River caused by the acid by-products, harming the public’s social and environmental interests. Therefore, Jinhui should be responsible for the pollution caused by its behaviors.

3. On the grounding of the judgement on whether Jinhui shall be liable to restore the ecology and environment.

Although rivers have certain self-purification capacity, the total environmental capacity is limited. Dumping large amounts of acid by-products will inevitably cause serious damages to the water quality, aquatic life, riverbed, river bank, and the ecology and the environment downstream. Without immediate remediation, the pollution will accumulate to a level that exceeds the environmental capacity and eventually result in irreversible damages. Therefore, the defendants’ liabilities cannot be relieved just because of the segment of the water body where the waste acid was dumped has been restored.

TEPF submitted an application to invite Professor Lv Xiwu from College of Energy and Environment of to be present as an expert assessor at the court of the first instance to advise on the assessment opinions and technical issues involved in the case. Professor Lv said that dumping hazardous wastes into the water poses direct damages to ecological functionality and natural resources. The cost to restore the damaged part of the Yangzte River system far exceeds the cost of disposing of the pollutants directly, and so does the cost of human interference to reduce the risks of the pollution to an acceptable level. In addition, the appraiser He Qihuan, Professor of University of Science and Technology, also said in court that the “virtual restoration cost” method can be adopted if it is impossible or difficult to calculate the actual costs of human intervening activities.

The liquidity of the water means that once pollutants enter the water, the site of the pollution cannot be restored to its original state. According to the first edition of Recommended Methods, “virtual restoration cost” methods can be adopted in this case because the restoration costs were “difficult to calculate”. In addition, the first edition and the second edition did not differ in the description of “virtual restoration cost” methods. It was correct for the judgement of the second instance to calculate the restoration expenses by multiplying the remediation costs and the amount of dumped acid by-products as set out in Technical Assessment Report by 4.5 times, the lower limit in the recommended sensitivity multiple for Type III Surface Water at 4.5-6. The investigation found that in the indictment of the first instance, TEPF described compensations for water pollution in its claims, while it actually meant restoration costs as clarified in the facts and reason it submitted. The ruling of the second instance did not go beyond TEPF’s claims by deciding that Jinhui must pay for the restoration costs.

4. On the factual grounding of the determination of 5460.18 tons of acid by-products

The acid by-products were dumped straight after being received by Jiangzhong from Changlong and Jinhui without any records of how many acid by-products were delivered by the two companies respectively. Nevertheless, the amounts were recorded by Changlong and Jinhui in the form of VAT invoice. DAI Weiguo and YAO Xueyuan had reported the total amounts from the two companies. The amounts of acid by-products sold by Changlong and Jinhui respectively and the amount dumped by Jiangzhong must first be clarified to identify the exact amount of acid by-products from Jinhui. Based on the VAT invoice and the interrogation records of DAI Weiguo, YAO Xueyuan and Jin’guang, the judgement of the second instance determined that Changlong sold 17598.92 tons of acid by-products to Jiangzhong and Jinhui sold 8224.97 tons. Then Jiangzhong sold 7170.71 tons of the combined amounts with invoice, and another 1508.92 tons without invoice. As a result, Jiangzhong dumped a total of 17143.86 tons of acid by-products. Since Jiangzhong dumped the mixed acid by-products from Changlong and Jinhui, it is impossible to know the exact amount of acid by-products from each company. Alternatively, the judgement of the second instance calculated on a pro rata basis and concluded that Jiangzhong dumped 11683.68 tons from Changlong and 5460.18 tons from Jinhui. This method is reasonable.

Jinhui’s determination of the amount of acid by-products dumped by Jiangzhong based on partial interrogation records of DAI Weiguo’s and YAO Xueyuan’s statements and partial transportation invoice is erroneous and cannot be supported. Criminal Judgement Tai Zhong Huan Xing Zhong Zi No. 00001 by the Intermediate People’s Court of Taizhou, Jiangsu Province (2014) provided by Jinhui in the retrial application confirmed the crime committed by DAI Weiguo and YAO Xueyuan or together with Jiang Qiaohong who collected 5460.18 tons of acid by-products from Jinhui and dumped them into Rutai Canal and Gumagan River. The amount of the acid by-products was consistent with the amount confirmed in the judgement of the second instance of the present case. Inconsistent with the scenarios set out in Article 387 and Article 388 of the Interpretation of the Supreme People’s Court on the Application of Civil Procedure Law of People’s Republic of China, the above-mentioned criminal judgement cannot prove that the judgement of the second instance of the present case erred in facts or evidence, nor can it overturn the judgement of the second instance.

5. On the violation of Jinhui’s autonomy

In the present case, a social organization aiming to protect the environment and public interest has filed an EPIL to identify pollution and damages to the ecology to approach environmental governance through litigation and to resolve disputes in environmental protection through the rule of law. The courts of the first and second instance carried through the concepts set out in EPL by prioritizing ecological protection and environmental restoration. Damages to the ecology was ascertained, and restoration expenses was calculated with reference to Technical Assessment Report and expert opinions. In addition, the courts used innovative methods to encourage the enforcement of the payment of the restoration costs，using judicial wisdom to balance the interests of different parties. After the judgement of the second instance took effect, three out of six defendants fully carried out the ruling of the judgement. Shimeikang and Changlong eventually withdrew their applications for retrials. In particular, Changlong confirmed that the judgement of the second instance was consistent with Changlong’s long-term development goals of protecting the environment and public interest. To avoid pollution from the root, Changlong invested CNY 47 million into environment projects, such as acid by-product recycling, which have passed inspection, received approval and are now in operation. By now, Changlong has performed all its liabilities and recognized that the negative impact of the litigation on the company has been transformed into motivation for it to correct the wrong and protect the environment. It can be seen that the judgement of the second instance did not violate the autonomy of companies. Instead, it has played a guiding role of EPILs to encourage polluting entities to make technological innovations and upgrades and to perform the corporate responsibility of protecting the environment.

The fourth section of the main text of the judgement of the second instance ruled that 40% of restoration costs can be deducted if the defendant can submit certificate to prove that it has abided by environmental laws, or environmental assessment and acceptance documents upon the completion of construction of a project, or technology upgrading investment audit report issued by qualified agencies. The purpose was simply to ensure that Jinhui has upgraded its technology, not to violate its autonomy or set approval barriers. Jinhui should assume its responsibilities as a corporate and an environmental protection entity, bringing the idea of sustainability into practice and prioritize environmental protection in production by carrying out activities as per the judgement and upgrading technologies to reduce environmental risks.

6. On reduced liability of Jinhui given EPILs against other polluting entities filed by Friends of Nature, Chaoyang District, Beijing

Jinhui submitted Civil Ruling Tai Zhong Huan Gong Min Su Chu Zi No. 00001 (2015) by Jiangsu Taizhou Intermediate People’s Court, Civil Ruling Su Huan Gong Min Su Zhong Zi No. 00001（2015）by Jiangsu High People’s Court with the intention to prove that the calculation of environmental restoration amounts that Jinhui was ruled to be liable for in the judgement of the second instance was wrong. The EPIL filed by Friends of Nature, Chaoyang, Beijing on the pollution of Gumagan River and Rutai Canal at Intermediate People’s Court of Taizhou, Jiangsu Province is under trial. The judgement of the second instance of the present case did not involve any overlapping of liabilities with other polluting entities in terms of the restoration costs that Jinhui should be liable for. Therefore, this court finds the Civil Ruling Tai Zhong Huan Gong Min Su Chu Zi No. 00001 (2015) by Jingsu Taizhou Intermediate People’s Court, Civil Ruling Su Huan Gong Min Su Zhong Zi No. 00001（2015）by Jiangsu High People’s Court provided by Jinhui not admissible because they do not affect Jinhui’s liabilities deemed in the judgement of the second instance and do not count as new evidence in the retrial examination.

7. On the application of Article 170, Paragraph 1, Subparagraph 1 of CPL in the judgement of the second instance

According to Article 170, Paragraph 1, Subparagraph 1 of CPL, “if the facts were clearly ascertained and the law was correctly applied in the original judgement, the appeal shall be rejected in the form of a ruling or judgement and the original judgement shall be affirmed”. The judgement of the second instance adjusted the timeline and conditions for Jinhui to pay for restoration expenses while upholding decisions of the first instance. It was not an amendment to the errors made in the judgement of the first instance, so the application of law was not wrong. The judgement of the second instance can encourage companies to improve technologies and lower environmental risks to reduce pollution from the root. This court will not support Jinhui’s groundless claim that the judgement of the second instance erred in the application of Article 180, Paragraph 1, Subparagraph 1 of CPL.

In summary, Jinhui’s retrial application is not compliant with Article 200, Subparagraph 1, Subparagraph 2, Subparagraph 6 and Subparagraph 11. Under Article 204, Paragraph 1 of CPL, This court rejects the retrial application made by Taixing Jinhui Chemical Company.

Presiding Judge: LIN Wenxue Judge: WEI Wenchao Judge: LIU Xiaofei Judge: WANG Zhanfei Acting Judge: Kaimin

January 31st, 2016

Judge Assistant: LIU Huihui Clerk: RAO Yun Clerk: LIU Yanan